Kerala

Idukki

CC/114/2021

Basheer N A - Complainant(s)

Versus

L I C Of India - Opp.Party(s)

26 Jul 2022

ORDER

 

DATE OF FILING : 12.8.2021

IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, IDUKKI

Dated this the  26^th  day of July, 2022

Present :

SRI. C. SURESHKUMAR                   PRESIDENT

SMT. ASAMOL P.                             MEMBER

SRI. AMPADY K.S.                           MEMBER

CC NO.114/2021

Between

Complainant                                           :  Basheer N.A.,

                                                                 Nadaparambil House,

                                                                 Muthalakkodam P.O.,

                                                                 Thodupuzha. 

       (By Adv: K.M. Sanu)

And

Opposite Parties                                     :  1.  The Manager,

                                                                     LIC of India,

                                                                     Thodupuzha Branch,

                                                                     Thodupuzha P.O.

       2.  LIC of India,

                                                                    Represented by

                                                                    The Branch Manager,

                                                                      Thodupuzha Branch,

                                                                     Thodupuzha P.O.

 (Both by Advs: M.V. Francis

& C.C. Liju)

O R D E R

SRI. C. SURESHKUMAR, PRESIDENT

 

          1. This is a complaint filed under Section 35(1) of Consumer Protection Act of 2019 (the Act, for short).  Complaint averments are briefly discussed hereunder :

 

          Complainant is a retired Police Sub Inspector.  1^st and 2^nd opposite parties are  Managers  of  Thodupuzha  branch  of  LIC.   Complainant had subscribed for                                                                                                         (cont….2)

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a policy, namely, ‘Jeevan Saral’ floated by the Corporation represented by opposite parties.  Policy tenure was 10 years.  Every quarter of the year, Rs.1,531/- was to be paid as premium.  At the time when the complainant had purchased the policy, he was made to believe that upon the expiry of tenure of policy, he will get Rs.1,25,000/-, which amount is payable as death benefit also.  Accordingly, premium was paid without any default, until the expiry of policy period.  Last premium was paid in June 2021.  As requested by opposite parties, all documents including original policy certificate were given by complainant to them for claiming maturity benefits.  However, to the utter surprise and disappointment of complainant, he was given only Rs.20,797/- as maturity benefit for the Policy.  Premium paid by the complainant would come to Rs.61,240/-, whereas maturity benefit was only 1/3^rd of the said amount.  Complainant is entitled to receive Rs.1,25,000/- as maturity benefit of policy.  Terms of the policy are printed in small letters and not readable.  Opposite parties have not heeded the directions of ‘IRDA’ for processing the claim of complainant.  Non payment of Rs.1,25,000/- towards maturity benefit by opposite parties would amounts to deficiency in service.  Complainant prays for a direction against opposite parties, for payment of Rs.1,25,000/- (apparently after adjusting amount already paid) as maturity benefit with 18% interest, compensation of Rs.50,000/- for the loss and mental agony suffered  by him owing to deficiency in service and Rs.10,000/- as litigation costs.

 

          2.  Opposite parties 1 and 2 represented by authorized signatory have entered appearance and filed written version on 11.10.2021 and an additional version on 12.11.2021.  No replication was filed by complainant in answer to additional written version. Though there is no enabling provision to file additional written version as of right and that too beyond the statutory time limit, we are narrating the whole case projected by opposite parties which is as hereunder in brief:

 

          According to opposite parties, a Jeevan Saral policy (Plan 165) was issued to complainant from Thodupuzha branch of LIC of India.  The policy had commenced on 28.6.2011 and date of maturity was 28.6.2021.  It had a tenure of 10 years.  At  the time of commencement of policy, complainant was 60 years old.  Insurance premium payable was Rs.1,531/- for every quarter of year.  Maturity  sum  assured was only  Rs.15,295/-, which is clearly mentioned in policy document. Death sum assured and accident benefit sum assured was Rs.1,25,000/-.  Complainant had remitted the last premium on 23.4.2021.  It is clearly mentioned in the policy that maturity sum assured is Rs.15,295/-.  Complainant was paid Rs.20,797/- as maturity amount which included Rs.5,506/- of loyalty addition.                                                                                                                (cont…3)

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Opposite parties would further submit that in Jeevan Saral policy, proposer can decide amount of premium and sum assured payable on death is determined on the basis of premium chosen by the insured, irrespective of age and term.  Death benefits sum assured will be 250 times of the basic monthly premium.  Monthly premium in this case is Rs.510.42, out of which Rs.500/- is basic premium and 10.42 is towards premium for double accident benefit.  As monthly premium opted by complainant is Rs.500/-, DBSA is Rs.500 x 250 = Rs.1,25,000/-.  Total premium collected is Rs.61,240/- (60,000 + 1240).  Maturity sum assured per 100 / basic premium for an insured aged 60 years with policy period of 10 years is Rs.3,059/-.  MSA for monthly premium of Rs.500/- will be Rs.15,295/- (3059 x 5).  In addition to this, insured will be entitled for loyalty addition at the rate of Rs.360/-, for every Rs.1000/MSA.  Total benefits would be 15,295 + 5,506 = Rs.20,801/-.  Out of this, Rs.4/- is deducted towards charges and amount payable will be Rs.20,797/-.  In Jeevan Saral policy, risk element is substantially high if the insured is aged 60 years and above.  If two persons, one aged 20 years and other 60 years are purchasing Jeevan Saral policy by paying the same premium, maturity sum assured payable to the person aged 20 years will be substantially higher than what is paid to the insured who is aged 60 years and above.

 

          Jeevan Saral Plan 165 was introduced for sale after complying with all the guidelines and requirements set by IRDA.  Premium applied for providing insurance coverage is as per settled principals of insurance which is “higher mortality charge for higher age” and as per mortality table provided by Institute of Actuaries of India.  There is no deficiency in service or unfair trade practice from the part of opposite parties.  Due amount was paid to complainant as per the policy.  Before filing this complaint, complainant had filed a claim petition before Insurance Ombudsman seeking the same relief.  This fact is concealed by the complainant.

 

Opposite parties would submit that agent who had canvassed the complainant for purchasing the policy was none else, but his own daughter, Seena N.B, by name.  This fact was also deliberately concealed by the complainant. That apart, insurance Ombudsman had passed an award on 16.9.2021 and had directed the respondent insurer, LIC, to pay an amount of Rs.39,199/-, which has been paid by LIC already.  Total amount paid is Rs.61,240/-, which was equal to the total premium paid by the complainant.  Complainant lacks merits and is to be dismissed with costs.

                                                                                                          (cont….4)

 

-  4  -

          3. After the filing of written version, case was posted for steps and then for evidence.  On the side of complainant, he himself was examined as PW1 and Exts.P1 to P3 were marked on his side.  Ext.R1 to R4 were marked on the side of opposite parties upon admission by the complainant during his cross examination.

         

          On the side of opposite parties, one witness, namely, Manager (Legal), LIC of India, divisional office, Kottayam was examined as RW1.  Exts.R5 to R15 series 2 in numbers were proved by him.  Thereafter evidence was closed.  Both sides were directed to file notes.  Complainant has not filed any notes. Oral arguments were addressed. Opposite parties had filed argument notes, copy of which was given to the learned counsel for complainant.  He was also heard in reply.  Now the Points which arise for consideration are :

 

1)  Whether complainant is entitled to receive Rs.1,25,000/- as maturity benefit for Jeevan Saral policy purchased by him from opposite parties ?

2)  Whether non payment of the said amount would amount to deficiency in service on the part of opposite parties ?

3)  Whether complainant was mislead by opposite parties into believing that he will get Rs.1,25,000/- as maturity benefit for the policy ?

4)  Whether there was any unfair trade practice from the side of opposite parties ?

5)  Whether complainant is entitled for getting Rs.1,25,000/- as maturity benefit and compensation of Rs.50,000/- ?

6)  Reliefs and costs ?

 

4.  Point Nos.1 to 5 are considered together :

 

          Learned counsel for complainant had narrated the complaint averments in brief and submitted that complainant was mislead into believing that maturity benefits of policy  would be Rs.1,25,000/-.  It doesn’t matter whether agent who had canvassed for purchase of policy was daughter of the complainant or any one else.  Referring evidence tendered by RW1 during cross examination to the effect that agents are trained to high light only the attractive terms of policy, counsel submitted that the fact that maturity benefits payable at the end of 10 years will be only equivalent to 1/3^rd of total premium remitted  was not disclosed to complainant.  Agent is engaged by the Corporation for sale of their policies and acts of agent will bind  corporation also.  Learned counsel would also submit that the award given by Ombudsman cannot be a reason for denying complainant’s                                                                                                                    (cont…5)

 

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claim for Rs.1,25,000/- receivable as maturity benefits.  Able counsel submitted that remaining amount after what has been paid already to complainant should be paid by opposite parties along with compensation and cost.

 

 

          Learned counsel for opposite parties 1 and 2 has filed argument notes on their behalf.  Notes mostly contains averments mentioned in the written version and additional version filed by opposite parties.  It also dwells upon evidence tendered by RW1 in brief.  It is mentioned therein that the terms of policy are evident from perusal of the policy document itself.  That apart, a petition was preferred before Insurance Ombudsman by the complainant for the very same relief which was partly allowed and an award was passed by Ombudsman.  There was payment of amount so ordered by the Ombudsman.  Complainant had received the money as per the award without any protest and therefore he cannot be heard to raise any contentions that he is entitled for more.  Learned counsel also pointed out that there is no specific averment in the complaint that opposite parties had mislead the complainant into believing that maturity benefit will be Rs.1,25,000/-.  The agent who had sold the policy to complainant is none else, but his own daughter.  Complainant had admitted this during his cross examination.  The same agent had represented the complainant in the proceedings before Ombudsman also.  During the pendency of proceedings before this Commission, he had received the amount ordered as per the award of Ombudsman.  This fact was also not revealed before the Commission.  Even in chief examination affidavit, this fact was suppressed.  At any rate, able counsel contends that complainant is not  entitled to get Rs.1,25,000/- as maturity benefit, since a competent authority had considered his claim and had decided his entitlement.  Learned counsel also pointed out that, in the award passed, there is a specific mention of the fact that opposite parties are not entitled to pay the said amount as maturity benefit in terms of policy agreement.  It was also observed that they can only function as per the guidelines and policy laid down by IRDA.  There is no deficiency in service and nor was any unfair trade practice.  Complaint is devoid of merits and is to be dismissed with costs. 

 

          We have gone through the pleadings and evidence on record in the light of rival contentions advanced by  complainant and opposite parties.  As rightly pointed out by learned counsel for opposite parties, it is specifically mentioned in Ext.R5, which is copy of policy that maturity benefit payable is only Rs.15,295/-.  That apart, complainant had preferred claim before Insurance Ombudsman alleging                                                                                                        (cont….6)

• 6 -

that he is entitled to Rs.1,25,000/- as maturity benefit for policy.  Ombudsman had considered his claim and had passed Ext.R3 award.  As per this award, Ombudsman had directed opposite parties to pay Rs.39,199/-, inclusive of earlier amount paid by opposite parties as maturity benefit.  Total amount paid by opposite parties as per the entitlement found by Ombudsman would come to Rs.59,996/-. Claim of the complainant raised here was considered on merits by Ombudsman and his entitlement was also decided.  This amount was received by the complainant also, without any protest.    It is also pertinent to note that complainant had not mentioned the fact that he had filed a petition before Insurance Ombudsman seeking payment of maturity benefit at the rate of Rs.1,25,000/-, also in this complaint.  Complainant had also not chosen to intimate this Commission that he had received the amount awarded by the Ombudsman from opposite parties, during pendency of this proceedings.

 

          As far as merits of the case are concerned, there are no specific pleadings in the complaint regarding identity of the official / employee of Corporation, who had mislead the complainant to believe that maturity benefit payable will be Rs.1,25,000/-.  Agent who had canvassed the complainant for purchase of policy is none else, but his own daughter.  This fact has been admitted by him during his cross examination. Daughter has not been made a party to this case and nore has the complainant summoned her as a witness.  He has given  evidence during cross examination that his daughter had represented him in proceedings before Ombudsman. Since complainant has no case that some other daughter of his had so represented him, it is to be presumed that the same daughter had presented his case in proceedings before Ombudsman too on the basis of which R3 award was passed. It is very much clear from Ext.R3 that the complainant had not informed Ombudsman that the agent who had canvassed him for purchasing the policy is his own daughter who was representing him in online proceedings of Ombudsman.  Award would disclose that the Ombudsman was made to conclude that policy was availed by complainant to help the agent to complete his yearly quota of policies.  That, it was the agent who had assured that the policy would fetch Rs.1,25,000/- after 10 years.  It was also mentioned before Ombudsman that the complainant was not educated and not having any knowledge of English and that he was not aware of details of the policy.

 

          Evidence tendered in this case would reveal that complainant is a retired Sub Inspector.  Hence we are not inclined to believe that he is not educated and was not having even working knowledge of English.  The fact that he had not chosen to                                                                                                                    (cont….7)

• 7  -

 

mention that the agent was none else, but his own daughter, before this Commission and also before the Ombudsman would prove that the complainant had very cunningly managed to obtain an award for a portion of the claim amount. Representations were in all probabilities, made before Ombudsman by daughter/agent that her father, a retired sub inspector, was uneducated and had no knowledge of English. Moved by this and also the fact that complainant was past 60 and had paid thrice the amount received as maturity benefit as premium, probably the Ombudsman had thought it fit to award atleast a portion of claim so that complainant may recoup at least the premium paid or something near to it. R3 would probablise that both daughter and father had made misrepresntations before Ombudsman and fraudulently obtained an award. Fraud nullifies everything. It is upto the opposite parties to seek appropriate remedial action in this regard and we leave the matter there.

 

Whatever it may be, complainant had  obtained an order from competent authority on merits with regard to the very same claim preferred before this Commission.  It is not as if that the present complaint was filed for balance due after taking into consideration the amount paid by opposite parties as maturity benefit initially and subsequently, as per the award of the Ombudsman.  That being so, it cannot be said that the claim would survive before this Commission, after the award passed by the Ombudsman.

 

          On merits also, the policy does not provide for payment of Rs.1,25,000/- as maturity benefit. Contentions that complainant was mislead into believing that maturity benefit would come to Rs.1,25,000/- by or at the behest of opposite parties, appear to be concocted, in the light of the fact that same daughter had represented him before Ombudsman.   There is no evidence to prove that there was deficiency in service on the part of opposite parties or that they had acted unfairly against complainant, leave alone resorting to unfair trade practice.  Complainant is not entitled to receive any amount from opposite parties towards maturity benefit or compensation.  Point Nos.1 to 5 are answered accordingly.

 

 

                                                                                                          (cont….8)

 

 

 

                                               

• 8  -

 

5.  Point No.6 :

 

          In the result, this complaint is dismissed with cost of opposite parties which we collectively quantifies as Rs.10,000/-, which shall be paid within a period of 45 days from the receipt of a copy of this order. 

 

                    Pronounced by this Commission on this the   26^th  day of July, 2022

 

 

 

                                                                                          Sd/-

       SRI. C. SURESHKUMAR, PRESIDENT

                  

                                 Sd/-

         SMT. ASAMOL P., EMBER

 

                       Sd/-

     SRI. AMPADY K.S., MEMBER

 

 

 

 

APPENDIX

Depositions :

On the side of the Complainant :

PW1         -  Basheer.

On the side of the Opposite Party :

DW1        -  George C.V.

Exhibits :

On the side of the Complainant :

Ext.P1      -   copy of policy.

Ext.P2      -   letter from opposite party.

Ext.P3      -  letter by complainant.

                                                                                                (cont....9)

 

• 9  -

On the side of the Opposite Party :

Ext.R1     -   copy of SSLC Book 1^st page.

Ext.R2     -  copy of proposal

Ext.R3     -  order from Ombudsman

Ext.R4     -   claim payment voucher

Ext.R5     -   policy document.

Ext.R6     -   letter from opposite party.

Ext.R7     -  discharge of matured policy.

Ext.R8     -  claim payment voucher.

Ext.R9     -  chart showing maturity sum assured.

Ext.R10   -  letter of opposite parties about results of valuation as at 31.3.2020.

Ext.R11   -   letter of opposite parties about introduction of Jeevan Saral policy.

Ext.R12   -  letter by complainant to the Ombudsman.

Ext.R13   -  agents confidential report.

Ext.R14  -   proposal by Smt.Seena Yoonus.

Ext.R15  -   claim payment voucher.

 

 

 

                                                                              Forwarded by Order,

 

 

                                                                        ASSISTANT REGISTRAR